Bessent Urges Removal of “Revenge Tax” from Trump’s Bill
On Thursday, Treasury Secretary Scott Bessent appealed to Congressional Republicans to eliminate the so-called “revenge tax” from President Trump’s significant legislation.
This provision allows Trump to impose taxes on foreign investments held by U.S. residents, ostensibly as a response to countries that introduce new taxes on American firms overseas.
Bessent contended that Section 899, as it’s known, has become irrelevant now that the Trump administration has reached an agreement with G7 nations to exempt American businesses from the 15% global corporate minimum tax championed by the Biden administration.
“After months of constructive discussions with other nations concerning the OECD global tax agreement, we are pleased to announce a mutual understanding among G7 countries that safeguards American interests,” Bessent remarked. “President Trump set the stage for this landmark achievement.”
According to Bessent, “The OECD Pillar 2 tax will not apply to U.S. companies. We’ll work collaboratively to implement this agreement within the OECD-G20 Inclusive Framework in the upcoming weeks and months. We appreciate our G7 allies for their partnership and cooperation in achieving this historic result.”
“In light of this progress, I’ve requested the Senate and House to dismiss the Section 899 provisions from the consideration of the big, beautiful bill,” he added.
A significant portion of the legislation is currently moving through the Senate. Senator Mike Crapo (R-Idaho), a key Republican figure on the Senate Finance Committee, confirmed the removal of the revenge tax provisions from the bill.
“Following Secretary Bessent’s request, we’ll eliminate proposed Section 899 from this major bill to uphold U.S. tax sovereignty and allow our tax laws to function alongside the Pillar 2 framework,” he indicated.
Jason Smith (R-Mo.), head of the House Ways and Means Committee, characterized the agreement as “a massive victory for American workers.”
Some voices on Wall Street were concerned that this provision could deter global investment in the U.S.
Originally, the Senate’s revenge tax was estimated to bring in over $50 billion in revenue over the next decade.
Trump has urged Congress to finalize the bill by July 4th.
Bessent remarked that the agreement with G7 partners “offers substantial certainty and stability to the global economy, promoting growth and investment in the U.S. and beyond.”
He also stated, “By rolling back the Biden administration’s commitments, we’re safeguarding our nation’s ability to implement tax measures that benefit American businesses and workers. This helps preserve our tax base and shields U.S. taxpayers from potential losses exceeding $100 billion, as per the Treasury Department’s estimates and the Nonpartisan Tax Commission.”
Furthermore, he asserted, “The Trump administration remains watchful against all forms of discriminatory foreign taxes imposed on Americans. We’ll defend our tax sovereignty and oppose efforts that create uneven playing fields for our citizens and businesses.”
